LayerZero to axe 14 low-activity chains after KelpDAO exploit – Details

Cross-chain interoperability provider LayerZero will withdraw off-chain support for 14 low-activity chains, including Arbitrum Nova. 

In its latest statement, the firm said that its DVN (decentralized verifier network) and Executors, collectively responsible for off-chain communication between different chains, will be deprecated for the 14 chains. 

The affected networks include Cronos zkEVM, Degen, Skale Europa, Superposition, Shrapnel, and more. As a result, some assets, including stablecoins (USDT and USDC) across these chains, could be stranded if not moved before the full shutdown.

According to LayerZero, the off-chain support will be axed in 30 days (by September). 

Since July, LayerZero has flagged over 30 chains with low activity, including the recently shut BounceBit. Although the move is positioned as operational efficiency, security risk and competition seem to be key reasons behind the aggressive shift. 

Chainlink CCIP traction threatens LayerZero

LayerZero has massive financial backing, including top-tier VC firms such as Sequoia Capital, a16z (Andreessen Horowitz), Binance Labs, and Coinbase Ventures. 

And the bet was simple: bridge the fragmented liquidity across various blockchains. But the KelpDAO’s $292M hack, one of the largest DeFi exploits in 2026, triggered a massive fallout.

The exploit stemmed from LayerZero’s recommended “1-of-1” DVN setup, which doesn’t give enough verification before large minting or fund transfers are approved. Since the same loophole can be used with low-adopted reserve assets, Aave has stopped supporting most of them, including ghost chains. 

In fact, several projects have since migrated from LayerZero to rival Chainlink CCIP (Cross-Chain Interoperability Protocol). Notably, the Wyoming state government, BitGo (WBTC), and Nethermind have migrated from LayerZero to CCIP. 

Chainlink’s Zach Rynes estimated that a total of $15B has been migrated from LayerZero, underscoring the expensive lesson for LayerZero for the KelpDAO fallout. 

Notably, after the exploit, LayerZero bridged volume dropped 4x from nearly 400K ETH to about 100K ETH. 

As such, LayerZero’s aggressive move to wind down support for over 30 chains may be viewed as a strategic play to reduce its security risk exposure. By extension, it’s meant to counter Chainlink CCIP’s growing competition after the KelpDAO exploit.

But whether that’s enough to stop its top projects from migrating to Chainlink remains to be seen.  

Final Summary

• LayerZero to withdraw support for 14 chains by September.
• Chainlink CCIP has attracted over $15B in assets migrating from LayerZero since the KelpDAO hack.